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March 2017

Knowing Your Priorities

By Rob Carey

The Golf Club at Omni Interlocken places a big emphasis on remaining member-focused, which has improved the golf product for outings, resort guests and local players

Since its debut in 1999, the 27-hole Golf Club at Omni Interlocken Resort near Denver has had only one director of golf, Larry Collins. He forged his bona fides at three TPC facilities in the preceding years, so from day one at Omni Interlocken, he understood the value of a robust membership—even as the heyday of Tiger Woods was making it easy to drive solid rate from resort and outside play. By 2007, the facility was serving 330 members.

Collins’ expertise was also central in helping Omni Interlocken survive the Great Recession, when membership fell by more than half. He notes that the club’s low initiation fee made it less difficult for many members to walk away between 2008 and 2010. But with little ability or appetite to hike that fee, “we had to reinvent ourselves from the member perspective, and reevaluate our approach to non-member play, too.”

After taking such a hit, the facility could easily have been tempted to shift toward driving more non-member rounds in order to deliver an immediate revenue stream. But “we’ve always found that we’re most profitable when the emphasis is on our membership,” Collins notes. “In fact, they’re the primary support of several outlets across the resort, not just golf.”

With a wide corporate base and younger demographic in Denver, as well a huge university presence in nearby Boulder, Collins and Omni ownership opted to broaden programming to enhance satisfaction among present members and perceived value among potential members. To further this approach, the facility would present underutilized inventory to non-members selectively, and only at its desired rate.

For the members, “we focused first on what our biggest strength is, and that’s having a wonderful pro staff that’s been here for many years,” Collins says. For instance, they run the men’s and women’s leagues with a highly personal touch, such as consistently persuading new members to join the Tuesday evening league where they are partnered with someone different each week.

“We’ve been able to bring in a lot of members who have never belonged to a club,” Collins explains. “And once we get them into programs, it becomes much harder for them to choose to leave.” Additionally, members are invited to bring a friend once a month to their weekly match, and the entire course is shut down for three days in August for the member-guest event. The result? “Guests often reinforce the idea to members that it’s a really great place, and many of them become interested, too.”

Another way Omni Interlocken prioritizes member satisfaction: Late afternoons no longer play host to non-member leagues, nor even a discounted nine-hole or twilight rate. “A lot of members come here after work, and the ability to play nine in an hour and 20 minutes is a huge draw,” Collins says. “We are fine with replacing just 75 percent of the revenue we’d get from discounted play through fewer nine-hole rounds at regular rate. This way, everyone who plays at that time gets a private-club experience.”

Off the course, Collins has found that offering members a 50 percent discount on food—all the time, in all resort outlets and for groups up to 12 people—delivers acceptable revenue.

“It’s such a strong sales element to say that members pay only half the listed price for their meals,” he says. “The clubhouse has a casual American grill and the hotel has a craft-beer tap room plus a very upscale restaurant, so the variety is attractive, too. Member use of our outlets has gone up a lot, and as long as beverages remain at regular price, the profit actually comes in a bit higher.”

With membership back up to 330 and attrition at just 10 percent, Collins says “the ideal number will be based on accessibility, which we judge by our three-tee starts on Saturday mornings. This year, we’ll probably cut off guest play for that, to make it a bit more exclusive. We think that 400 is best for us; by mid-2017, we’ll have about 370.”

In 2007, Omni Interlocken operated successfully with just 3,000 rounds of outside play in addition to 4,000 resort rounds. By 2009, though, outside rounds rose to 11,000 at a 40 percent lower rate. Thanks to the facility’s post-recession strategy, though, the 2009 scenario is never to return. Of its 38,000 rounds in 2016, Omni Interlocken kept individual outside rounds to 5,000—but brought in significant revenue from more than 20 Monday group outings.

“Charity events can use all 27 holes because that’s a real competitive advantage for us,” Collins admits. “We ask each event planner, ‘Could you get more players if we had the room for them?’ and they almost always say yes.

“That’s bringing more money to their cause, from additional players and sponsors alike,” he continues. “And our members know closing the course to them until early Monday afternoon is central to our business model and their dues structure.”

To cement the long-term relationship with each charity group, Collins has devised a few signature service elements. “We like to say we’re much more interested in each group than they’re interested in a golf facility,” he says. “We sit down with them and ask a lot of questions about past performance of the event, and show them how much more they can raise from doing it with us.”

Part of that comes from the way Collins treats an event’s sponsors. “They need to feel fully invested even before they arrive on event day, so we’ll entertain them one week before to give them a little more recognition. And on event day, we bring each of them up before the cart send-off and thank them personally in front of the players. We’ll run a lot of sponsor messaging on the carts’ Visage system, too.”

Interestingly, resort rounds have remained consistent at Omni Interlocken for many years, at just under 10 percent of the annual total. But Collins sees opportunity to drive this high-rate niche through 12- to 60-person business- or wedding-related outings that won’t inconvenience members thanks to the three-tee format.

Otherwise, business groups often use the practice green for “crazy golf” cocktail receptions, where each mini-golf hole presents a different tool to putt with—hockey stick, pool cue, hammer, shovel and so on. And “movie night on the green” will debut in 2017, and one 200-person group has already signed up to sit around the edges of the practice green and watch “Tin Cup” while enjoying snacks and refreshments.

As for individual play, there’s opportunity for strong “staycation” business from a local market where the population is growing nicely. And while many golf facilities dread Topgolf as a potential siphon of demand, Collins sees it differently. “I think the Topgolf experience will drive more people to come outdoors to play regular golf. We need to persuade them to try it at our club.”

Rob Carey is a freelance writer and principal of Meetings & Hospitality Insight.